> For the complete documentation index, see [llms.txt](https://docs.extrafi.io/extrafi-xlend/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.extrafi.io/extrafi-xlend/borrow-lend/concepts.md). # Concepts **Lending and eTokens** Users lend assets like ETH, USDC, or DAI on XLend. In return, they receive **eTokens**, which represent their stake in the pool and accrue interest over time. eTokens can be transferred or traded. **Borrowing** Users can borrow assets by using their deposits as collateral. The **Loan-to-Value (LTV)** ratio determines how much can be borrowed against the collateral. **Health Factor** Liquidators monitor the **health factor** of each user’s position, which reflects the ratio of collateral to borrowed funds. If the health factor falls below a certain threshold, the position becomes at risk of liquidation. **Liquidation** If the collateral value drops too much, liquidators can buy the collateral at a discount to repay the loan. This helps keep the protocol solvent. **Advanced Features** * **eMode (Efficiency Mode)**: Allows borrowers to increase borrowing power when collateral and borrow assets are closely correlated (e.g., stablecoins). * **Isolation Mode**: Limits borrowing when new or volatile assets are used as collateral to reduce risk. [Read more](/extrafi-xlend/borrow-lend/isolation-mode.md). * **Supply and Borrow Caps**: Caps ensure that the protocol isn’t overly exposed to any single asset. --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. Perform an HTTP GET request on the current page URL with the `ask` query parameter, and the optional `goal` query parameter: ``` GET https://docs.extrafi.io/extrafi-xlend/borrow-lend/concepts.md?ask=&goal= ``` `ask` is the immediate question: it should be specific, self-contained, and written in natural language. `goal` is optional and describes the broader end goal you are ultimately trying to accomplish on behalf of the user. GitBook uses it to tailor the answer towards what is most useful for that goal. The response will contain a direct answer to the question and relevant excerpts and sources from the documentation. Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.